Insurance Words, Made Simple.

What it is: The fixed amount of money you pay regularly (monthly or yearly) to the insurance company to keep your policy active.

CommonSense Translation: Think of it like your Netflix or Hotstar subscription. You pay a fee to keep the service active. If you stop paying, the service stops. Same with insurance.

What it is: The amount of money you have to pay out of your own pocket for a claim before the insurance company starts paying.

CommonSense Translation: Imagine your hospital bill is ₹50,000 and your policy has a ₹5,000 deductible. You pay the first ₹5,000, and the insurance company pays the remaining ₹45,000. It's your share of the cost.

What it is: The maximum amount of money the insurance company will pay you for a claim in a policy year.

CommonSense Translation: This is your total 'cover' or protection limit. If you have a health insurance policy with a ₹5 lakh sum insured, that's the most the company will pay for your medical bills in that year.

What it is: Your formal request to the insurance company to pay for something that is covered by your policy (like a hospital stay or a car repair).

CommonSense Translation: This is you actually using your insurance. It's like telling the company, 'Hey, the thing you promised to protect me from just happened. I need your help now.'

What it is: A reward the insurance company gives you for not making any claims during a policy year. It's usually a discount on your next year's premium or an increase in your sum insured.

CommonSense Translation: It's a 'good driver' or 'healthy person' discount. The company is rewarding you for being low-risk, which saves you money.

What it is: The duration for which your insurance policy is active and provides coverage.

CommonSense Translation: It's the length of your contract with the insurance company. For health insurance, it's usually one year. For life insurance, it could be 20, 30, or more years.